MY TRIP TO PC FORUM 2005
LOU MAZZUCCHELLI
In memory of Hunter S. Thompson
The hot sun beat down on the Fairmont Scottsdale Princess and the polished concrete in the copiously-
fountained courtyard felt like an Itanium processor without a heat sink. I figured I could find all the cold
tequila I wanted once I got through the registration process for PC Forum 2005. PC Forum – a cloying
combination of smug success and naked ambition that Esther Dyson’s been running for over 20 years as
some fevered crossbreed between the Oprah Winfrey Show and a Stuart Smalley self-affirmation
meeting. This year the conference theme was “The World-Wide World – IT Ain’t Just The Web
Anymore!” OK, so Yahoo! donated! some! punctuation! but when was IT ever only about the World
Wide Web? Just because the high-tech market went on some peyote-fueled binge a few years ago doesn’t
erase 40 or 50 years of history. Or maybe it does – and now we get to read Mark Cuban’s revised
version.
I navigated the maze of 50” Sony LCD high-definition televisions that would be used for software
demonstrations later in the conference, found the registration desk, got my stinking badge, a tote bag that
looked like it would be right at home on the shoulder of any Botswanan tourist, and some program
material. Then I went to the front desk of the hotel to check in so I could dump the stuff in my room and
hit the pool before things started.
I knew things were going bad when the chirpy front-desk clerk looked at me like her Zanax had just given
out as I gave her my name, the conference name, the name of the person I was subbing for, Warren
Harding’s name, and then a really dirty look. No record of me existed. Luckily I didn’t have to reach
over and rip her lungs out because Brodie Crawford, Esther’s main man, intervened and then things were
cool. I made a beeline for my room, changed into my bathing suit and flip-flops and did the rest of my
prep work on a lounge chair by the bar at the main pool.
Sunday 3PM: The World Wide World
The Sunday session is typically where PC Forum wears its social conscience on its sleeve, so Esther
welcomed us all (“us all” being about 60% of the attendees – more would arrive later to be there for
Monday’s main event), told us that “IT is expanding”, and asked the audience to “focus outside of white
engineers in silicon valley” (of which more later). Then we got to hear from Howard Gardner, Andy
Stern, and Jerry Yang, a real one-of-these-things-is-not-like-the-other trio.
Howard Gardner, professor at the Harvard Graduate School of Education, is known (by certain strata of
society) as the developer of the theory of multiple intelligences, which posits that (in humans, at least)
individual intelligence is not uniform and can develop in specialized areas. Why this was surprising in
1994 to anyone exposed to cognitive science is of minor historical interest, but Gardner’s ideas did get
some traction, so much so that he discovered a government project in Australia attempting to correlate
intelligence type with racial and ethnic origins.
Not wanting to be associated with a possible new eugenics trend, Gardner has created a “good work
project” – examining how people use intelligence in a “pro-social” way. This project has interviewed
1200 people (selection criteria not explained) to elicit their opinions on excellence, ethics and meaning
and their desire and ability to do “good work” as defined above. One interesting common theme among
young interviewees was that “I can’t do good work now, because no one else is doing it and therefore if I
do it I will be at a competitive disadvantage (paraphrase mine)”. There was a clear implication by
Gardner that this was an ethical or moral bad thing, with much head-nodding in the crowd.

Perhaps lost on a successful, tenured Harvard professor was the fact that some in the audience don’t know
where their next months’ mortgage payment is coming from, and can’t figure out how they can afford to
put their children through school or if they’ll ever be able to retire. Perhaps it was lost on a good chunk
of the audience as well.
Gardner also discussed the issue of trust in society and the concept of “trustees”, publicly-acclaimed
persons of stature who would hold the public trust and cited, interestingly, the recently late George
Kennan as an example. Compare that with a recent poll in Cambridge, MA that named Alan Greenspan,
Oprah Winfrey and Jon Stewart as current “trustees” in the eyes of those polled. He suggested that “good
work”, say in an NGO, might help 200 or 2,000 people, but that bad laws can hurt 200,000 or 2,000,000 –
the lesson being that those prone to good work build as big a power base as possible to counteract the
effect of those in power with a propensity for “bad work”.
Next, Andy Stern, President of the Service Employees International Union, asked a truly important
question: “How are we going to reward work in America?” Not for the Carly Fiorinas of the world (to
use a timely IT example) who get $100M to decimate (or, arguably, deliver the coup de graceto) an
American high-tech pioneer, but for the rank-and-file (increasingly defined as everyone beneath the
highest levels of corporate management) who have to cope with an increasingly challenging environment
to survive.
Sterns’ facts are compelling: thirty years ago, GM was the largest employer in the US, 1 in 4 private
sector workers were union members, and one GM union job could support a family. Today, Wal-Mart is
the largest employer in the US, 1 in 12 private sector workers are union members, and it takes two to
three Wal-Mart jobs to support a family (how many of those workers do you think are of a mind to do
Gardner’s “good work”?). To Stearns’ credit, he was forthright in his criticism of past (and current)
union behavior focused solely on collective bargaining, declaring that, in the main, unions were “male,
pale and stale”. However, he was not apologetic in claiming that unions were historically the most
effective anti-poverty and wealth distribution system – without direct government expense.
Stern’s provocative closing suggestion was that, since the US is running an international trade surplus in
services (and since services appear to be a growth segment of the US economy for the foreseeable future),
we consider finding a way to use this surplus to implement job security programs for US workers.
Needless to say, many audience eyes were glazed over at this point but a surprisingly large portion gave
Stern a warm reception.
Jerry Yang, Taiwanese immigrant, raised by his grandmom, founder of Yahoo! – a guy who stuck his
thumb in the Internet pie and pulled out a billion dollar plum – should have been a great segue from
Gardner and Stern. Instead, he fielded some softball questions from Esther (who has always been a
softball pitcher; however, she seems to have gone from fast-pitch to slow-pitch over the past decade).
This yielded such wisdom as “In the next ten years (Yahoo!) can try to do what we really wanted to do
ten years ago” and “(Yahoo! has to) strike a balance in China (regarding censorship)”. I don’t think that
Esther’s approach was colored by Yahoo!’s announcement, that day, that it had acquired Flickr, in which
she had invested. Not at all.
Sunday postscript: IAC announces it is buying Ask Jeeves for almost $2B. The search weenies are going
to be impossible for the rest of the conference...
The alarm clocks in our rooms had the worst user interface ever conceived. I felt like putting one in a
FedEx box and shipping it to Don Norman. At breakfast Monday, we all discovered that we felt the same
way. Good. I knew I was drunk when I went to bed but I worried I had become stupid as well.
Monday is the big show at PC Forum. You can tell by the massive influx of CEOs, CEO wranglers and
other PR people intent on wringing every last bit of positive spin from the audience, especially those on
deadline. Great sport can be had by engaging one of the luminaries in a side conversation and then
fending off the PR cleanup detail, usually represented by attractive young women oozing ambition.

On paper, a great panel. Steve Ward, CEO-to-be of Lenovo is to lead off. But wait – didn’t Lenovo used
to be Legend? And didn’t Legend used to be owned and run by the People’s Army? Now this spawn of
Estridge and Mao is about to move its headquarters to New York and is talking about listing on the
NYSE. What would George Kennan say about that?
Ward did his best to present the very image of a modern CEO, which is to say, he was boring as hell. We
learned a) Lenovo will work in English, and b) that the two sides need “a shared vision”. Duh. Anne
Mulcahy didn’t fare that much better. She dished out some more global management pablum and let slip
one interesting factoid that Xerox’s acquisition of Tektronix revealed interesting differences in the
business practices of Fuji Xerox when dealing with Tek versus Xerox – details not disclosed, of course.
John Schwartz of Sun scored a few points by articulating some of what Steve and Anne had been groping
for – that, to be global, a company has to immerse themselves in the local market, not view it as a colony
(by merely chasing cheap labor, for example). I almost felt optimistic for Sun after John’s comments.
Almost.
Monday 8:55 AM: “Write Your Own Ticket To PC Forum” Winner
The winner turned out to be Peter Glaskowsky, someone whose work I followed for years when he was a
senior contributor to Microprocessor Report. Peter spoke for about five minutes about virtualization,
laying out the advantages (which anyone who has studied computer architecture should know by heart)
and some disadvantages (mainly that virtualization enables fascist DRM policies). While his talk sailed
right by a good section of the crowd, he unwittingly placed a land mine for Scott Charney of Microsoft
on the next panel. He also contributed a lovely anecdote: when he told his librarian girlfriend about his
impending trip to PC Forum and the conference focus, she replied “if these IT folks are going to focus on
my stuff, please ask them to fix my computers first”.
Monday 9 AM: Security And Identity: You Talking To Me?
We learned from this group that “security thinking is permeating all aspects of IT” and that “security is
the fastest-growing segment of IT”. All of the panelists subscribed to the maxims that perfection is
unattainable and that the eternal struggle between usability and security will persist. However, I fell off
my chair when Scott Charney of Microsoft said “there will always be users who double-click and enable
actions that disable their machines” – hello? Why are users to blame here? Isn’t this an operating system
problem? Wasn’t he awake during Peter’s talk on virtualization? Oh, wait. He’s from Microsoft. Never
mind.
Then John Thompson from Symantec compared pervasive computing to driving an automobile, and
suggested that, just as the government imposed regulation in the name of auto safety, we might be better
served with similar regulation in the name of computing safety. Charney chimed in and asked the crowd
“how many people would favor an RFID mechanism that limited cars to the posted speed limit when
traveling?” No hands went up – not one. Say, how’s that software registration project going in
Redmond, Scott?
Was Thompson over the line when he compared computer security decentralization with the spread of
democracy, and implied either that there was no turning back or that there were sinister motivations for a
move to more centralization? I can understand the defensiveness of Scott and John – after all, one
represents arguably the most pernicious monopoly created in the last century and the other has a business
model that is based on cleaning up after it. Small wonder that Jayshree Ullal from Cisco appeared as if
she were traveling at another flight level – she did get off a great turn of phrase, though, when she blamed
part of the usability problem of security software on “too many nerd knobs”.

Monday 9:50 AM: The Brain: Prediction and Intelligence

Twelve years ago, Jeff Hawkins was the lunchtime speaker at PC Forum. We (yes, I was there...) heard
him describe a novel theory of brain function that modeled intelligence as the ability to predict bits in
serial bit streams. Fast-forward twelve years. The theory has progressed, and has started to be reduced to
algorithms that can exhibit behavior associated with intelligence. According to this theory, there are four
essential attributes of the non-reptilian part of our brain:

The neocortex is a memory system
(“You don’t need a neocortex to live but life is more interesting with one...”)

The neocortex builds a model of the world through exposure to sensory input

The neocortex predicts future events by analogy to past events

Human behavior is a by-product of prediction

The concept has been prototyped using a hierarchy of conditional probability distributions and a belief-
propagation system. Using a three-level hierarchy, the prototype system is capable of simulating visual
recognition of a 90-symbol set of black-and-white line drawings and variants thereof. This is a very
impressive result.
According to Hawkins, this Heirarchical Temporal Memory (HTM) is:

- Broadly applicable to a wide-range of problems
Fundamental technology

- Can be made faster and deeper than human memory - Can be extended to “exotic” senses (SONAR, LIDAR, etc)
Is non-threatening (it’s just memory)

There is a research institute (The Redwood Neuroscience Institute, www.rni.org), a book (OnIntelligence, Jeff Hawkins, Times Books 2004, ISBN 0-8050-7456-2) and a start-up (Numenta, www.numenta.com) working to further develop these concepts. While I try to curb my enthusiasm about
such things (and, if behavior is a by-product of prediction based on past events, then by what mechanism
am I writing this? Is there, biologically speaking, truly nothing new under the sun?), HTM has the
potential to take engineering work based on neural networks to a significantly higher level. You gotta
root for it.
Wow. Something that might be mistaken for real technology at PC Forum – can we keep up the pace?
Monday 10:40 AM: Afternoon Overview: Company Presenters Present Themselves
Nope. If Esther was trying to get beyond “white engineers in silicon valley”, she only succeeded in the
silicon valley part. Talk about pale, male and stale. Ten startups (well, nine startups plus Opera), ten
male CEOs. Each given two minutes to set the stage for a 30-minute presentation later in the day. The
first one, Jeremy Jaech, CEO of Trumba, did a pitch that was so bad that he (or more likely, his PR firm)
should have been taken out to the courtyard, weighed down with stones and tossed into the fountain. I
take that back. The PR firm should have been drowned for the pitch – Jaech should have been drowned
for the business model – calendar consolidation. Maybe a nice feature, probably not a whole business.
But what do I know?
Or how about EVDB, which has raised perfectly good venture capital to “become the de facto standard to
help people discover events they might be interested in”? Like Dave Barry says, “I am not making this
up”...or Grouper Networks, “a peer-to-peer file-sharing network with built-in community and privacy,
and an operating plan that might help keep it legal”? And people wonder why the wheels are coming off
the US technology car.

I noted three presentations that might be worth my time (well, the readers time, actually): Opera
Networks, Rearden Commerce, and Brightcove.
Monday 11:20 AM: Health Care: No Patient Left Behind?
This panel got off on the right foot when Carol Diamond of the Markle Foundation noted that “Healthcare
IT is automating things that don’t work well”. Caroline Kovac of IBM piled on by noting that, in a
trillion dollar system (US healthcare, all in), there’s probably $450B of waste. Larry Augustin of
MedSphere noted that 100,000 people die each year in the US due to preventable medical error – 7,000
due to illegible handwriting (there’sa case for Catholic schooling...).
Lonny Reisman of Activehealth Management weighed in with a timely comment on the Terry Schiavo
case – what led to her initial cardiac arrest was a low potassium level, a very critical symptom that should
have been, but was not, caught during prior examinations. Could better patient recordkeeping (abetted by
IT) have prevented this whole legal mess and, incidentally, saved the woman’s life?
Augustin described his new business, which combines healthcare IT and the open source software model
by taking a patient record system, VISTA, that was developed at taxpayer expense by the VA, and
bringing it to market.
Much handwringing ensued. Dawn Lepore of Drugstore.com was a no-op on the panel.
Monday 2 PM: Company Presentations
Rearden Commerce. I knew this company as Gazoo, and its CEO, Pat Grady, when I worked on the
Street five years ago. Can’t say the new name is much better – it’s both polarizing (depending on your
opinion of Ayn Rand) and unoriginal (Rearden Steel was Steve Pearlman’s name for WebTV while in
stealth mode). Also, Pat’s personality is abrasive – but, he’s put $3M of his own money into this project,
and tenacity counts.
Rearden may be on to something. In the time since I last saw them in a San Francisco storefront, they
have developed a solution for enterprises to enable and manage employee purchases of services (travel,
hotel, car, shipping, etc) based on an extensible service-oriented architecture. The initial solution is sold
as a subscription, and has attracted the attention (and dollars) of several large customers including
Whirlpool and Motorola, who replaced about a dozen home-grown applications with the Rearden
solution.
Rearden has partnered with HP, which will resell Rearden Employee Business Services (EBS)
applications as part of HP’s business-process outsourcing product line. The Rearden Commerce
framework is also being evaluated by several partners as a means to develop applications beyond EBS.
Rearden itself has the opportunity (and strategic challenge) to take this technology wider (as a
connectivity and commerce platform) and deeper (as a developer of additional vertical applications).
www.reardencommerce.com.
Opera Software. The publicly-traded, Swedish supplier of web browsers, viewed as a contender for
number two in the US before Firefox released last year. Jon von Tetzchner, Opera’s CEO, did a good job
positioning Opera against the competition, and highlighted its key differentiator of comparable behavior
across platforms ranging from desktop PCs to cell phones. Opera can probably hold share in the
embedded browser segment, but it’s hard for me to see how, without substantial marketing expense, the
company can significantly increase its share in the US market. Especially since it costs $29 and Firefox is
free. www.opera.com.

Brightcove. Jeremy Allaire parleyed a mediocre web database product (Cold Fusion) into a small
fortune, got his company acquired by Macromedia and took the CTO job after Norm Myerowitz moved
on. Now he’s raised capital from General Catalyst and Accel to create what is effectively an iTunes
video store for independent content producers. So, no major-label content? Hmm...

We saw a mock-up of the service, which featured a selection of Warren Miller ski videos. Allaire asked
who in the room knew of Warren Miller, and most of the pale, male hands shot up (mine included). We
were treated to a barrage of Flash eye candy as we were taken through a purchase and got to watch part of
the video. Yawn. I think that Apple, Direct TV, Comcast, Time Warner, Disney, Viacom, the rest of the
cable MSOs and my daughter’s guinea pigs are all working on similar projects.
So, from the back of the room, I asked Jeremy if he intended to exercise editorial control over content, or
let this system find its natural market, that is, porn. Answer: no porn. Prediction: no business. The big
guys are going to have major studio content. Without porn, Brightcove gets Warren Miller films. If I
went to a street corner in downtown Phoenix, and I asked 1,000 people if they’d heard of Warren Miller,
maybe I’d get about 5 positive responses. So Brightcove is going to have to work very hard to aggregate
a large enough collection of marginalized content (Lithuanian language lessons, curling videos, etc) to
break even.
The good news is that Brightcove’s VCs, if they come to their senses in time, will only flush $5.5M. Or
maybe Jeremy is hoping that Dan’l Lewin, who was standing behind me, will snap this turkey up for
Microsoft before anyone figures out what kind of bird it really is. www.brightcove.com.
Monday 6:30 PM: Cocktail Reception and Dinner, Emily Levine
I needed several drinks to wash some of the howlers I’d heard throughout the day from my mind. But
that still couldn’t dull the persistent yammering of the PR folks and startup CEOs trying to pitch their
deals to anyone who looked like a potential investor. I finally found a guy who had enough empty glasses
in from of him to indicate the seriousness of his intent, and we enjoyed a fine dinner together. He turned
out to have attended every PC Forum, and we began to trade stories. He also turned out to have been
Regis McKenna’s first general manager, and did a lot of work for Apple in the early days. Here’s my
favorite excerpt from his side of our well-lubricated dialogue:
When Apple was planning to run their first full page ad in the Wall St. Journal, the original version only
featured Steve Jobs as the inventor of the personal computer. When shown the mock-up, Mike Markkula,
CEO of Apple at the time, turned white, and said, “there is another Steve you guys should meet”. And so
Steve Wozniak was added to the photo and body copy, and the ad ran featuring the two Steves. A few
days after the ad ran in the Journal, my new-found friend’s phone rang at work. It was the receptionist
telling him that “some old lady is on the phone yelling about the Apple ad”. Foolishly, my friend took the
call and found himself talking with Mrs. Wozniak (as in ‘mom’), who proceeded to chew him out
vigorously, saying “my boy did all the work and why is that Steve Jobs getting credit for it?”
And that, gentle readers, made the day entirely worthwhile.
After dinner we were entertained by Emily Levine, best described as a cross between Bette Midler, Lilly
Tomlin and Wallace Shawn. She did a good job recapping the days’ events and pointing out the
humorous inconsistencies therein. This was followed by the traditional PC Forum jam session, which
was an unassailable argument against that particular tradition.
Back at my room, there was that stupid alarm clock again. The wake-up call desk was jammin’.
Tuesday 8 AM: Friction Can Be Good!
If you’ve been around the block more than a few times, you’re familiar with a style of management book
writing that takes a current phenomenon and tries to spin it into a story for the ages. So when I saw that

John Hagel (the third) and John Seely Brown (the first) had written a new book (The Only Sustainable
Edge, John Hagel III and John Seely Brown, Harvard Business School Press 2005, ISBN 1-591-720-0), I
had a good idea of what to expect from this session (thank you, neocortex...).
Turns out that both John’s have been spending time in what we used to call the Far East, with Toyota and,
of more novelty, the Chinese province of Chongqing (nee Chungking), home to 10.2 million people.
Chongqing now accounts for over 50% of worldwide motorcycle production, having reduced the export
price of motorcycles from $700 to $200 in the last ten years. The bulk of the session was goggle-eyed
reporting of the methods used to achieve this.
One cannot argue with the success of Chonquing (certainly not Honda, which has been forced out of the
Asian motorcycle market as a result), and one has to admire the ingenuity of the Chinese in organically
developing a design style and a manufacturing and supply network that has taken advantage of the current
Chinese environment to achieve an optimal result. But many of the John’s “requirements for productive
friction” are not all that revelatory: the need for performance metrics, highly-motivated people with
relevant skills, focused action points and pattern recognition are all concepts that been used and taught
for many years. Furthermore, anyone who tried to transplant the Chongqing model to another culture will
immediately bump up against problems in infrastructure – labor laws, intellectual property laws, cultural
differences, etc. In fact, the Chinese themselves will erode the efficiency of Chongqing as its society
continues its (cultural only, we hope) march toward the West. Wasn’t it Norman Augustine who once
said that the best way for the US to compete was to export lawyers?
A memorable term did surface: innovation blowback. This is what happens when, say, a US company
treats an emerging country as merely a market rather than a source of innovation. Then the smart people
in that country take the products or services, improve them, and export the improvements back to the US
to the detriment of the original supplier. Sound familiar? Now we have a good name for it.
Then came the more entertaining metaphors including the Chongqing “motorcycle reference
implementation” as another example of the open-source concept in action, and the prescription that the
key to IT is SOA plus virtualization plus social software, all coming together to create a shared virtual
collaborative workplace. I don’t know if this prescription will kill anybody, but at least the handwriting is
legible.
Tuesday 8:40 AM: Presence In The Enterprise
By 8:40, the three cups of coffee I’d downed to jumpstart my consciousness had begun to kick in, so I
was particularly attuned to the message of the next panel. And the message was: Me! Me! It’s all about
Me! I want others to know where I am! I want others to know what I’m doing! So that they can find
ME! But only when I want, because my schedule is Mine! And no one is more important than Me!
Or are they? Richard Schwartz, CEO of SoloMio, justifies his business model by noting that it increases
the number of billable events to a wireless carrier. So instead of a non-answered call which costs me
nothing, I can look forward to a SoloMio mediated call, which costs me something. What part of me is
that about, exactly? My wallet, I guess...
The other members on the panel, Charles Digate of Convoq and Johannes Ernst of NetMesh, discussed
their respective technologies and benefits at length, but what struck me was the inordinate complexity and
cost to manage something that is probably better managed by turning one’s cell phone or PDA or PC off.
Digate managed to get in a howler: “...Flash, which as we all know everybody has...”.
I suppose that the escape clause in my argument is the word “Enterprise” in the session title. And I won’t
argue that business communications is sometimes frustrating. But I would argue that these and other
proposed solutions are, like healthcare IT, automating things that don’t work well. And yesterday’s
enterprise technology seems to become today’s consumer technology.

This panel was all the more ironic thanks to The New York Times Magazine, which on March 20
published a piece titled Bad Connectionsby Christine Rosen, where she argues persuasively that
“personal technologies like our cells (sic) and TiVos have put us out of touch with the manners and mores
of public life.” She would have enjoyed observing the behavior of the gadget-laden at this conference.

Tuesday 9:30 AM: Fast Data In The Enterprise
Disclaimer: Stan Zdonik and are old acquaintances and better friends after this conference. It turns out
we’ve led eerily parallel lives. Please note, however, that if he dished drek it would have been duly
reported.
StreamBase Systems was formed out of research Stan did with Mike Stonebraker at MIT and others to
apply familiar SQL approaches to real-time streaming applications. StreamBase has developed a stream-
processing engine that provides low-latency, fault-tolerant SQL operations on data from trading systems,
credit transaction processing systems, communications networks and other sensor arrays, allowing
optimization of the kind and amount of data that must be stored. They also provide a graphical
development environment to model the data streams and the operators thereon.
There are several very neat tricks employed to make this work: one is to break up the continuous stream
of data into “time windows” of fixed length and apply operations on the window. Of course, the results
have to be correlated and relations that cross window boundaries have to be accounted for. A storage
hierarchy is employed to maximize performance – nothing completely new here except that it’s
economically feasible to think about terabyte in-line databases, which certainly helps.
As you might imagine, the financial and intelligence communities are all over this. I suspect that other
organizations involved in electronic commerce will be enthusiastic supporters as well. Stonebraker is a
known quantity to VCs, so StreamBase quickly attracted investment from Accel, Bessemer and Highland,
and should have the resources needed to prove their business model hypothesis.
In our conversations over drinks later, I suggested to Stan that moving to operations on time-based data
might be like the motion from arithmetic to calculus was for numbers, which leads naturally to the
question of what new operators (beyond SQL) will emerge from this development. He said he’d think
about this, but first he had to go to a meeting in Nashville, in his role as President of the International
Bluegrass Music Association.
So, the “potentially important new stuff at PC Forum” count goes to 2.
Tuesday 9:50 AM: Strategy In Practice – Interview With Ann Livermore
The only question that need be asked about this session: would HP’s stock price go up after it was done?
Answer: not in my book, and apparently not in the market either. Here was a room full of people that
were arguably more knowledgeable about HP’s situation than most, and Ann was serenely justifying the
HP/Compaq merger by citing their server volume leadership. This is like captain of the Titanic serenely
observing the part of the horizon that wasn’t sporting any icebergs.
Now, I understand that, as a senior executive in a major US corporation, you can’t air dirty laundry in
public, but to not acknowledge that the company is, at least, undergoing a period of uncertainty is equally
irresponsible. On the other hand, Ann didn’t have to dodge any hard questions, because they weren’t
asked. Esther wasn’t throwing softballs, she was lobbing Nerf balls.
After this dismal performance, one person in the audience told me “I just spent seven figures on storage
products from EMC because I couldn’t get HP to sell me anything. And HP is our preferred provider.”

The 10:15 break was welcomed by all.

Tuesday 10:45 AM: Open Source: A Working Model, Not A Movement

Open source might not be a movement, but according to Mitchell Baker of the Mozilla Foundation,
“proprietary software is an evolutionary aberration”. That certainly got the audience’s attention, and so
began a discussion of trends in open source.
Larry Augustin, not on the panel, actually did the best job of describing the phenomenon (my
paraphrase): First, open source was only games, and people said “that’s fine but those open source
zealots will never make a compiler”. Then everyone started using gcc, and the naysayers said “that’s fine,
but those open source zealots will never build an OS”. Then Linux started gaining ground, and the
nattering nabobs of negativism said “that’s nice, but open source will never be used to make
applications”, and now we have Apache, Sugar (an open-source CRM tool), Firefox and VISTA, to name
a few.
So, maybe, when an application becomes generic enough, its evolutionary destiny is to become open
source. If so, then what is the future of the software industry? One obvious implication is that new
software businesses will be nichier, and therefore smaller. No more Microsofts (even without the Justice
Department being asleep at the switch) or Oracles. The big companies will look more CA, gaining their
size from aggregation, not million-unit software licenses. There will also be services businesses that add
value to generic open source applications by performing customization, installation and training. But
that’s a 40% gross margin business, not a 90% one.
Then there’s the issue of testing. Even if you assume that an open source mechanism can deliver
adequate functional testing (a topic of some debate), it’s very hard to imagine an open source community
with the resources to do comprehensive compatibility testing.
Enter SpikeSource. Its business model is to offer the resources, on an outsourced basis, to anyone
needing such testing. SpikeSource can also manage patch distribution, which evokes images of
Marimba’s “push” technology, which evokes images of Kim Polese, Marimba’s photogenic CEO...and
guess who’s running SpikeSource? That would be Kim.
I’m thinking: is there a giant meta-neocortex running the Universe that recognized a pattern and predicted
this? Or, maybe I’m just getting hungry...
Tuesday 11:25 AM: Contest Winner
Oh, the contest. Haven’t mentioned that yet. See, we were all supposed to vote on the company most
deserving of $50,000 in CNET advertising, based on their presentations Monday afternoon. And the
winner is...Endeca, which enables focused searches through large databases. Endeca’s running $10M
quarters, so I question the impact of their prize. Was the voting influenced by the IAC news Sunday?
Tuesday 11:30 AM: New Directions in Search: Mirror Mirror On The Wall
Endeca’s win provided a great segue into the final panel. Representatives from several search companies
discussed the direction of search technology and the search business. An issue was the evolving
definition of “relevance”, from just page counts to results based on personalization and context (and if
you are leaping ahead to thinking about a potential problem, that too much personalization and context
can lead to narrow result spaces and the creation of “personal silos” of information, then blame your own
neocortex, not mine...). Another was presentation, both on the traditional desktop and in portable
devices. I am personally interested in the non-traditional desktop, but that is another story...
As this panel ran long and my stomach began to garner more of the focus of my autonomous nervous
system, I headed for the door but remember thinking “who would have predicted that PC Forum 2005
would end with a discussion of Library Science? And why weren’t any librarians on that panel?”

Tuesday 6:00 PM: Joint Dinner Reception With Flight School

You may have noticed a gap in the timeline from noon to 6 PM. I admit it, I couldn’t bring myself to
participate in a discussion of either a) Education, or b) User-Generated Metadata. I knew that (a) would
degenerate into well-meaning bloviating and I had done enough metadata generation of my own in the
past two days to avoid (b). I opted instead for the non-judgmental company of the waitress by the pool.
Flight School is Esther’s attempt to leverage some of the energy (and wealth) generated by IT to other
purposes, in this case aviation and “mobility”. There were some conference attendees overlapping, and
the idea of a joint dinner was a good one.
Our dinner speakers were Bruce Holmes of NASA Langley Research Center and George Butler, producer
of Shackleton’s Antarctic Adventure and Pumping Iron, among others. George gave us a sneak peak of a
new film he’s made about the Mars Exploration Rovers, coming soon from a major studio whose name
we all promised not to tell. It’s awe-inspiring, and makes you proud to be a geek.
Bruce talked about current NASA issues. He shunted questions about Hubble aside laying all the blame
on Congress. He talked about interplanetary issues, including creating public-sector and private-sector
spaces in Earth orbit and beyond. I asked him how this zoning plan for the solar system would play out
if, by the time we got back to the moon, the PRC was there as our welcoming committee. No good
answer to that one either. Most of the conversation then turned to private aviation, a topic of obvious
interest to the entrepreneurs and pilots in the audience. A lot of the conversation focused on personal
aviation, and what could be done to make personal aviation faster, safer, and more flexible.
The entertainment portion of the dinner program continued during the question-and-answer session when
a long-time PC Forum denizen, co-creator of a seminal application, a nice guy, but noted for his ability to
become almost mind-numbingly incoherent in conversation, asked a question that veered off course into
the semantic troposphere and was simultaneously shot down by both participants and Esther, all claiming
microphone trouble.
After the dinner session broke up, I found myself talking to Cameron Burr, son of Donald Burr, founder
of People Express. He’s working for his dad, who has partnered with Robert Crandall, former CEO of
American Airlines (and RI native) to create a new non-scheduled, point-to-point air taxi business called
Pogo using the next generation of low-cost very light jet aircraft (VLJs) that are in development now from
companies like Adam and Eclipse.
Bruce Holmes, Cameron and I ended up (where else?) at the bar trading airplane stories and wrestling
with the finer points of strategy for Pogo. I probably learned more than I was supposed to, but isn’t that
the point?Postscript: Wednesday 7AM Breakfast
I ran in to Esther at breakfast. She was prepping for her Flight School debut, but managed to pop her
head up from her laptop to be sociable. I told her about the previous night’s conversation, and then
opined that, if private aviation follows the paths described, we were likely to end up with a bifurcated
travel system in the US akin to “taxis and buses” on a national scale. I suggested that an unintended
consequence of this bifurcation could be reduced flexibility, and perhaps opportunity, for those only to
afford “bus” travel. This in turn could have a negative impact on travel and location-based entertainment
businesses, like Disney.
Esther looked at me and said “well, we can’t all be rich”. Certainement, mademoiselle Antoinette... -30-

TWTR is hitting new lows on the news, but the company still has an $11B market cap.

This valuation reflects classic "there must be a pony in here somewhere" thinking - shareholders are generally loathe to watch their investment (or stock options) burst into flame, so it is not surprising to see intense amounts of flailing and bloodletting while players scramble to patch the leaks in this Titanic.

Just before this report, I had the opportunity to explore Twitter's future with a bunch of undergraduate business majors. Not one of the 30 or so students (who should be squarely in the company's target market) claimed to be a regular Twitter user. Not one of them said they would pay a subscription for the service. When asked to imagine what Twitter might do differently, their responses were not much different from what Twitter management is proposing - but when I asked how successful any of those moves might be, I got shoulder shrugs.

One brave soul suggested that Twitter close down, not unlike Michael Dell's approach to Apple during that company's darker days. While I can see the merits in that option (it's certainly better than watching the company's cash pile shrivel to zero), I think there is something about Twitter that keeps everybody from just throwing up their hands. But that something may not be, as they say, "monitizable".

Where Twitter has consistently shown value and differentiation is as a lightweight, organic, slippery communications conduit for transient social events - from fluff like the latest Kardashian antics to
more meaningful events, like Arab Spring. This makes sense given its embrace of lightweight clients built around SMS messaging.

Twitter has tried to get celebrities to pay the freight with 'promoted' tweets, and there is probably a niche market in the PR industry for this that is sustainable, but not at the scale dreamed by Twitter investors. Likewise, there may also be a news industry niche as a headline aggregator. Both of those niches, however, are coming under more intense fire from competitors.

One Twitter response is video. Not only is Twitter late to this party, but stuffing a Twitter feed with video a) requires a bigger client that is harder to make ubiquitous), and b) gums up the lightweight, casual Twitter interface that is one of its key differentiators.

So, Twitter may ultimately be one of those good ideas that is not a good business. If the world values the original idea, a non-shutdown option presents itself: turn Twitter into a non-profit.

Making Twitter a non-profit organization would preserve the parts of Twitter that society seems to value, while freeing it of the constant struggle to justify its existence to Wall St.

It is possible? Maybe. What if:
- A majority of Twitter shareholders agree that this is a good idea (or at least a way to salvage
something from their investment)
- The IRS lets shareholders contribute their TWTR stock to a new tax-exempt non-profit
foundation and take a deduction (at their basis, not an inflated value)?
- Substantial additional reductions in headcount get operating expenses to a level that
can be supported by interest on Twitter's existing cash (around $3B) plus some donations
from foundations interested in freedom of speech and communications around the world?
This would imply some R&D to make messages hard to stop.

That organization would have a comprehensible mission, and the hope of a sustainable future.
As opposed to Twitter, which has an incomprehensible mission, and a dubious future.

Full disclosure: I'm an extremely casual (a few times a year) Twitter user. It doesn't work on my dumb phone. I tried on my desktop, and the content wasn't compelling compared to my Facebook feed. I get my stupid Presidential tweet fix from Facebook re-posts. I'm not trying to build a business based on "followers", so that aspect is also irrelevant. After this experience, I am reminded of nothing so much as Biggus Dickus's query in Monty Python's Life of Brian: "Why are they twittering"?